Ashland Global Holdings Inc (ASH)
Cash ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 417,000 | 646,000 | 210,000 | 454,000 | 232,000 |
| Short-term investments | US$ in thousands | 77,000 | 61,000 | 37,000 | 30,000 | 24,000 |
| Total current liabilities | US$ in thousands | 456,000 | 553,000 | 934,000 | 813,000 | 757,000 |
| Cash ratio | 1.08 | 1.28 | 0.26 | 0.60 | 0.34 |
September 30, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($417,000K
+ $77,000K)
÷ $456,000K
= 1.08
The cash ratio measures a company's ability to cover its short-term liabilities using its cash and cash equivalents. Ashland Inc's cash ratio has fluctuated over the past five years. In 2023, the cash ratio stands at 1.19, indicating that the company has $1.19 in cash and cash equivalents for every dollar of current liabilities, reflecting a strong liquidity position. This represents a decline from the previous year's ratio of 1.33, suggesting a potential reduction in the ability to cover short-term obligations. However, it is important to note that the 2023 ratio remains relatively high, indicating a healthy cash position. In 2021, the cash ratio experienced a significant increase to 0.30 from 0.67 in 2020, reflecting a temporary reduction in liquidity. This was preceded by a noticeable improvement in the ratio from 0.39 in 2019 to 0.67 in 2020, indicating an enhanced ability to meet short-term liabilities. Overall, while the 2023 ratio has decreased, it still demonstrates a favorable liquidity position when compared to the prior year.
Peer comparison
Sep 30, 2023